PLN secures gas from Gajah Baru field through gas swap agreement

State utility company PT PLN has finalized gas swap negotiation with production sharing contractor (PSC) Premier Oil BV, facilitated by upstream oil and gas regulator, BPMIGAS.

Under the deal, 40 million cubic feet of gas from Gajah Baru field in Natuna, developed by Premier Oil BV, will be allocated for domestic market, namely to gas-power plant PLTG Muara Tawar.

However, the gas will not be taken from Gajah Baru field. As agreed under the gas swap deal, 40 million cubic feet of gas from ConocoPhillips? Corridor Block, which was supposed to be sent to Singapore buyers, will be redirected to PLTG Muara Tawar.

In return, 40 million cubic feet of gas, supposed to be supplied to Singapore buyers from the ConocoPhillips field, will be covered by gas from Gajah Baru field.

?We have discussed the gas swap so that gas from Premier?s gas field (Gajah Baru) will be delivered to PLTG Muara Tawar amounting to 40 BBTU. The price of gas is being negotiated,? Division Head for Primary Energy of PLN, Suryadi told Petromindo.com.

The gas supply contract will last until 2013.

Suryadi said PLN agreed to buy gas at price of US$7 per MMBTU. PLN will soon move on to sign the gas purchase swap agreement. PLN expects gas to flow to Muara Tawar on October 20, 2011. (godang)